The news from England and Wales is better. The unanimous and relatively
predictable decision of the UK Supreme Court in Rainy Sky S.A v Kookmin
Bank [2011] UKSC 50 (introduced by Jason below) to reverse the decision of
the Court of Appeal re-affirms a commitment to a more more commercial and
common sense approach, rejecting the more literal (and distinctly
uncommercial) approach of the majority of the Court of Appeal.

Ghosts of the past may linger in that in the lower courts the (former)
Commercial Court judges (Simon J and Sir Simon Tuckey) favoured the more
commercial approach, whereas the principal judge of the majority in the CA
had sat in the Chancery Division (Patten LJ, with Thorpe LJ a former
Family Division judge agreeing) favoured a stricter reading.

Most usefully (at para [20]) Lord Clarke rejected Patten LJ's more
traditional approach at [2010] EWCA Civ 582, para [42].

Formally there is no difference between the legal and equitable approach
in E & W (BCCI v Ali [2002] 1 AC 251), but one does not have to be a fully
paid up legal realist to appreciate that the constitution of the court may
affect the parties' entitlements.

Gerard McMeel

On Thu, November 3, 2011 8:45 am, David McLauchlan wrote:
> Neil
>
>
>
> As a non-Australian, not surprisingly I am unaware of similar instances.
> What is particularly alarming to me is that the High Court has refused to
> take an ideal opportunity to clarify the most practically important area
> of contract and commercial law. In a nutshell, the lower courts have
> simply been instructed yet again - the same message was delivered a few
> months earlier in Byrnes v Kendle [2011] HCA 26 - to follow Codelfa until
> they are told otherwise. And, contrary to what is said in the leave
> judgment, the appeal had considerable merit. Indeed, in my not
> particularly respectful view, a substantial miscarriage of justice has
> been done. I am not alone in this view. When I covered the NSWCA decision
> in an LLM class in Sydney earlier this year, the students were shaking
> their heads in astonishment. Not that everything is rosy with the more
> enlightened UK ICS principles. There are signs in some recent English
> cases of a retreat from those principles to an approach not all that
> different from Codelfa! But that is another story. So too is the much more
> liberal view of the NZ courts, particularly to receiving evidence of prior
> negotiations and subsequent conduct. On the surface at least, the law
> relating to the mundane task of contract interpretation is substantially
> different in each of NZ, Australia and the UK. It should not be so hard.
>
>
>
> Regards
>
>
>
> David
>
>
>
>
> David McLauchlan
> Professor of Law
> Victoria University of Wellington
> ________________________________
> From: Neil Foster [Neil.Foster@newcastle.edu.au]
> Sent: Thursday, November 03, 2011 6:11 PM
> To: David McLauchlan
> Cc: Jason Neyers; obligations@uwo.ca
> Subject: Re: Contract Interpretation
>
> Dear Colleagues;
> I must say that the approach of the UKSC does seem to commend itself above
> the approach summarised as still being binding in Australia by the High
> Court. But I speak of that whereof I do not know, not being across
> contract law.
> What does puzzle me is probably trivial but seems odd- I have not before
> seen a High Court of Australia decision refusing special leave to appeal
> with its "own" medium neutral citation reference. In most cases a decision
> of this sort would have appeared in the HCATrans series- indeed, now that
> I look I see this one does as well: Western Export Services Inc & Ors v
> Jireh International Pty Ltd [2011] HCATrans 297 (28 October 2011). So we
> have the somewhat odd situation that there are two separate electronic
> references to the same decision. (The HCATrans one contains the comments
> of the court on argument, so one can see what was concerning their
> Honours, one part of which seems to have been the suggestion that inferior
> courts in Australia should follow decisions in the UK which were arguable
> contrary to Codelfa.) It seems that the three members of this special
> leave bench decided that this trend to "loose" reading of contractual
> terms was such a potential problem that their decision here needed to be
> brought to the professions' attention more clearly than an "ordinary"
> refusal of special leave. Is anyone aware of other such examples of
> special leave decisions being highlighted in this way?
> From a precedential point of view, a special leave decision seems fairly
> clearly not binding (even one that has been "elevated" in this way.) But
> from a pragmatic perspective I suppose this means that anyone wanting to
> argue that a more "commercially oriented" view of interpretation should be
> adopted knows they will have some strong resistance from at least some
> members of the High Court.
> Regards
> Neil
>
> On 03/11/2011, at 7:42 AM, David McLauchlan wrote:
>
> And for an interesting contrast in approaches, see the High Court of
> Australia's refusal to grant leave to appeal from the appalling decision
> of the NSWCA in Jireh International Pty Ltd v Western Export Services Inc
> [2011] NSWCA 137: http://www.austlii.edu.au/au/cases/cth/HCA/2011/45.html
>
>
>
> The traditional "plain meaning" approach is alive and well in Australia.
> The High Court has ruled that the NSWCA was correct when it held that a
> court must give effect to "unambiguous" language "unless to do so would
> give the contract an absurd operation". It is not enough that the
> contract has an uncommercial or unbusinesslike operation. An article
> discussing the NSWCA's decision and other recent developments in Australia
> will shortly appear in the Journal of Contract Law.
>
>
>
> David
>
>
>
>
> David McLauchlan
> Professor of Law
> Victoria University of Wellington
> ________________________________
> From: Jason Neyers [jneyers@uwo.ca]
> Sent: Thursday, November 03, 2011 6:52 AM
> To: obligations@uwo.ca<mailto:obligations@uwo.ca>
> Subject: ODG: Contract Interpretation
>
> Dear Colleagues:
>
> Those interested in contractual interpretation will be interested in Rainy
> Sky S.A and others (Appellants) v Kookmin Bank
> (http://www.supremecourt.gov.uk/docs/UKSC_2010_0127_Judgment.pdf)<http://www.supremecourt.gov.uk/docs/UKSC_2010_0127_Judgment.pdf>
> which deals with the question (or so I am told) of whether when it comes
> to the interpretation of express terms one should use old fashioned
> literalism, contextualism, or common sense.
>
> Happy Reading,
> <http://www.supremecourt.gov.uk/docs/UKSC_2010_0127_Judgment.pdf>
>
> --
> Jason Neyers
> Associate Professor of Law
> Faculty of Law
> University of Western Ontario
> N6A 3K7
> (519) 661-2111 x. 88435
>
> Neil Foster
> Senior Lecturer
> Newcastle Law School Faculty of Business & Law
> MC158, McMullin Building
> University of Newcastle Callaghan NSW 2308 AUSTRALIA
> ph 02 4921 7430 fax 02 4921 6931
> http://www.newcastle.edu.au/staff/profile/neil.foster.html
> http://works.bepress.com/neil_foster/
>
>
>
>
>
>
>


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